ECONOMICS
MARKETS AND PRICES
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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mixed economic system
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planned economic system
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a free market system
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command system
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Detailed explanation-1: -Smith was a strong advocate for individual freedom, free-market economics, competition, and capitalism.
Detailed explanation-2: -Adam Smith described free markets as “an obvious and simple system of natural liberty.” He did not favor the landowner, the factory owner, or the worker, but rather all of society. He saw, however, self-defeating forces at work, preventing the full operation of the free market and undermining the wealth of all nations.
Detailed explanation-3: -He’s known primarily for his groundbreaking 1776 book on economics called An Inquiry into the Nature and Causes of the Wealth of Nations. Smith introduced the concept that free trade would benefit individuals and society as a whole.
Detailed explanation-4: -Adam Smith was the ‘forefather’ of capitalist thinking. His assumption was that humans were self serving by nature but that as long as every individual were to seek the fulfillment of her/his own self interest, the material needs of the whole society would be met.
Detailed explanation-5: -Dome (1994) states that Smith’s theory of economic growth consists of a rise in the productivity of labour by means of the division of labour, and an increase in productive labour by way of capital accumulation.